The government is about to invest £1.3 billion in transforming HMRC into one of the world’s most advanced tax administrations.
The new system will demand that most unincorporated businesses, self employed people, landlords and anyone with a secondary income of over £10,000 per year, will have to keep track of their affairs digitally and provide at least quarterly updates to HMRC via their digital account.
Free apps and software that will link securely to HMRC systems will be made available, along with support for those who might need a helping hand with the new technology. Alternatively, existing cloud-based accounting software (such as Xero) will be compatible with the requirements of the new regulations.
Will the digital tax regulations help or hinder businesses?
Dafferns’ clients who have not yet made the change to cloud-based accounting may view these changes as another legislative hassle, looming on the horizon. However, we would urge them to think again.
Direct bank feeds, app based accounts payable and expenses recording have transformed the entire bookkeeping process for many of our clients already. In addition to saving on bookkeeping expenses, the whole accounting process is now reduced for many small firms to just an hour (or less) per week.
It is also vital to stress the benefit of being able to access a complete and up-to-date financial picture anywhere, any time and on any device.
The days of rear-view-mirror accounting are officially over! At Dafferns, we firmly believe that, with Xero accounting software, businesses will now be able to make better decisions, based on current performance, rather than the last set of accounts which might be up to a year old.
Talk to us about the digital tax changes now!
If you haven’t made the transition to cloud-based bookkeeping, there really is no time like the present. Our team would welcome the chance to talk to you about how it could work for your business, or private finances.